BEIJING -- McDonald's Corp. and Mattel Inc. said they have been looking into an outbreak of violence last week at a Chinese factory that supplies them with toys but haven't found any evidence that the incident was a result of poor treatment of workers.
The companies began their investigation into the factory in southern China's Guangdong province after a report by China Labor Watch, a New York-based activist group, said that more than 1,000 of the plant's workers had rioted to protest poor wages and working conditions.
The factory, owned by Merton Co. an unlisted Hong Kong company, makes toys and promotional items that are sold by McDonald's and Mattel as well as other foreign firms, including Walt Disney Co.
China Labor Watch's report alleged that the factory, which is located in the city of Dongguan and employs more than 10,000 people, doesn't pay workers enough for overtime and provides poor living arrangements and inadequate insurance. Gary Rosen, a spokesman for McDonald's in China, denied that the incident was caused by Merton's labor practices and said McDonald's believes the incident is an isolated one.
The investigation determined that a disgruntled worker who had been recently laid off returned to the plant and, together with a group of his friends, committed several acts of vandalism, Mr. Rosen said.
McDonald's will continue to monitor conditions at its factories, he said. Tens of millions of former peasants work in factories in Guangdong province, which borders Hong Kong and is the manufacturing powerhouse of China.
They earn wages that are very low by developed-country standards but that can still be attractive compared to a life of subsistence farming.
Reports of large-scale labor unrest are rare, but there has been increasing evidence in recent years that these workers are becoming more demanding about the terms of their employment. The growth of industry in other parts of China has given laborers more options for employment, while rising prosperity has led workers who remain in Guangdong to demand higher wages. F
actory managers in the region report that they are having to offer better benefits and conditions to attract enough workers and keep them from leaving. Executives at Merton's headquarters in Hong Kong couldn't be reached during the weekend for comment on last week's incident, which China Labor Watch said had begun July 22.
An employee at the Dongguan factory said she is aware that a conflict had occurred but hadn't personally witnessed the event. Local police said some workers had been detained July 24, though they said the cause of the violence is still under investigation.
Mattel spokeswoman Lisa Marie Bongiovanni said that Mattel and other affected companies had sent auditors to the Dongguan factory to look into the incident. She said those investigators have "not been able to substantiate the claims" made by China Labor Watch.
A spokeswoman for Disney said the company is also investigating, but didn't elaborate. All three companies require their suppliers to follow certain labor standards and submit to regular inspections of factory conditions. "This is a reputable factory," said Mr. Rosen of McDonald's. "We're there because they adhere to a code of conduct."